Dedicating one’s life to serving your country is one of the most noble commitments a US citizen can make. And while this life can be dangerous, actively participating in the US armed forces can be met with numerous rewards. One way the Department of Veteran Affairs thanks its veterans and active service members is through a Veteran Administration Loan.
VA loans offer veterans interest rates and financial benefits unmatched in the market. Sure, there may be some more hoops to jump through, but Angela Conterno will guide you every step of the way to ensure our active military personnel and veterans receive the lowest rates available for their California homes.
What is a Veteran Administration Loan and Are You Eligible?
A VA loan is a mortgage insured by the US Department of Veteran Affairs and issued by private lenders like banks or credit unions. They can only be obtained by veterans, active-duty service members and qualified spouses.
It is estimated that less than 12% of veterans and active military personnel utilize their VA loans. A little known fact is that a possible reason for this low percentage is that any veteran, no matter their age or number of times they have qualified for a VA loan, is still eligible for a VA loan. Whether it’s been 5, 15, or 30 years since you served, you still qualify as long as you’re borrowing for your primary residence.
Condominiums are somewhat of a gray area. As condos differ from buying a multi-unit property or single-family residence, the VA has to approve the specific condo in order for a veteran or military service person to purchase a unit.
There has also been an exciting change to VA loans within the Blue Water Navy Vietnam Veterans Act. According to the VA, “veterans will now be able to obtain a no-down payment home loan in all areas, regardless of loan amount.” This allows veterans living in expensive market areas like Hermosa Beach or Manhattan Beach to still apply for a VA loan as there is no cap to the VA loan limits.
To see if you qualify, you must first obtain your DD Form 214. A qualified VA lender then requests your VA Certificate of Eligibility for you, or you can request it directly from the VA ebenefits website.
Why Consider a VA Mortgage for Los Angeles County?
There are numerous advantages to utilizing a VA loan to buy your property. Some of the primary benefits include not having to deal with private mortgage insurance (PMI), as well as low interest rates and closing costs. PMI alone adds anywhere between 0.5% to 1.0% to the monthly cost of your home. Let’s say you owe $200,000 on your mortgage. Your yearly PMI would then cost upwards of $1000 to $2000 in a year. But now with a VA loan, this cost is completely waived.
Another major benefit to VA loans is your down payment – or lack thereof. As a general rule, homebuyers are encouraged to put down 20% or more of the total home value towards a down payment. But again, this is unneeded for veterans and active military persons through a VA loan.
However, while San Pedro military personnel can take advantage of the above benefits, putting as much money down as possible is still strongly suggested. The more money you can put down, the faster you’ll be able to pay off your house. And it’s important to know how much house you can afford to develop a feasible working budget for you and your family.
VA Loans and Achieving Good Credit
Yet another benefit is that the VA doesn’t set a minimum credit score needed to obtain a loan. It should be mentioned that having fair to positive credit can help you attain a fixed interest rate or rock bottom variable. The three major credit bureaus now offer free access to check your credit report on a weekly basis. This offers you a hands on approach to your credit score; providing you with insight on how positive and negative spending practices quickly affect your financial well-being.
Consistently paying bills on time and living within your means also makes you more attractive to all lenders. This will come in very handy when applying for a home equity loan to improve your Redondo Beach home or for any emergencies that may arise.
6 VA Loan Tips
Here are 7 VA Loan tips to consider if you’re thinking of buying a home through a VA loan.
How to Find the Best VA Loan in the South Bay, CA
While the federal government insures all VA loans, they do not actually loan you the money for your future house. Applying for a VA loan still requires working with a bank or lending institution. And as with all government loan programs, sometimes the paperwork can be tedious. Fortunately, the Henry Falkenstein & Associates team can guide you through this process seamlessly to aid Los Angeles County military veterans and active service members. Together, we can work to ensure we find the right house for you.
Angela is a San Pedro and Palos Verdes native, and is very familiar with the benefits of living in this wonderful coastal area of Southern California. As a key member of the family real estate business, Henry Falkenstein & Associates, she is able to service clients in San Pedro, Palos Verdes and the South Bay areas with ease. Whether you're a "first time" home buyer, a home seller or seasoned investor, she will ensure that you have all the necessary data and resources to make completely informed decisions about your real estate transactions. Her job as your Realtor isn't complete until you are 100% satisfied with her service!